S&L OWNER'S `MAGIC' ITEMS MAY VANISH - INTO A LIBRARY

Federal regulators may give the Library of Congress a collection of memorabilia from the world of magic that was seized from the head of a failed thrift.

Thousands of posters, handbills, 16th-century books and private letters from Harry Houdini and other noted magicians were taken from Carl M. Rheuban after the savings and loan he ran was closed last month.Regulators say Rheuban, who ran First Network Savings in Century City, allegedly spent at least $1.5 million of the thrift's money on the magic collection, which was named after the late John Mulholland, an early 20th century magician.

Library of Congress officials say they don't have the money to buy the collection, which was seized by the federal Resolution Trust Corp., the bailout agency for ailing savings and loans.

"These aren't just card tricks we are talking about," Larry Sullivan, chief of the rare books collections at the federal library, said of the magic collection.

Kevin Shields, spokesman for Resolution Trust, said his agency usually sells all seized assets at auction, but the rarity of the magic collection has him considering whether to hand it over to the Library of Congress.

"It is an unusual asset, to say the least, for a savings and loan to have. If this were an apartment building, it would be an easy decision," said John F. Penrose, who is overseeing the thrift's closing for Resolution Trust.